Japan’s Nuclear and Industrial Safety Agency (NISA) said March 12 that the explosion at the Fukushima Daiichi No. 1 nuclear plant could only have been caused by a meltdown of the reactor core, Japanese daily Nikkei reported. This statement seemed somewhat at odds with Japanese Chief Cabinet Secretary Yukio Edano’s comments earlier March 12, in which he said “the walls of the building containing the reactor were destroyed, meaning that the metal container encasing the reactor did not explode.”

… If this report is accurate, it would not be the first time statements by NISA and Edano have diverged. When Edano earlier claimed that radiation levels had fallen at the site after the depressurization efforts, NISA claimed they had risen due to the release of radioactive vapors.

The volcano is on Kyushu island, about 950 miles from the epicenter of Friday’s magnitude 9.0 earthquake, which devastated much of the country’s northeastern coast. It was unclear if the eruptions were linked to quake, officials said. Japan lies on the “ring of fire,” a seismically active zone where earthquakes and volcanic eruptions are common. The volcano last erupted Jan. 19 after remaining dormant for two years.

… Sunday’s eruption, which was the biggest volcanic activity in Shinmoedake in 52 years, caused widespread destruction and panic. The blast could be heard for miles, and shattered windows four miles away, the BBC reported. Hundreds of people fled the area as the volcano spewed debris, including hot ash and rocks, more than 6,000 feet in the air, according to BBC reports.

The climax of the 1967 James Bond movie You Only Live Twice was filmed there.

(3) About the economic effects: report by economists Takahide Kiuchi and Kohei Okazaki of Nomura Securities, 13 March 2011

A 9.0-magnitude earthquake occurred off the northeastern coast of Japan on 11 March (Friday). The earthquake, with its epicenter in the Tohoku-Sanriku area, was the largest ever recorded in Japan. The size of the economy of the main earthquake-affected region is roughly the same as that of the area hit by the Great Hanshin (Kobe) earthquake in 1995, but with this Tohoku Pacific (Sendai) earthquake affecting road networks, power plants and other infrastructure over a wide area, we expect the short-term economic impact to be greater than the Kobe earthquake.

The area affected by the Sendai earthquake has a large number of IT-related companies. Due to the earthquake and tsunami, the Japanese economy is now likely to take longer than we expected to exit its current lull. We had projected an Apr–Jun exit but now forecast Jul–Sep or possibly Oct– Dec. We forecast that the largest negative impact on quarterly real GDP growth will emerge in Apr–Jun 2011. We think a slump in the domestic economy caused by the earthquake is an overly pessimistic outlook. However, based on the experience of the Kobe earthquake, we think a V-shaped recovery supported by a rapid upturn in demand driven by government-funded rebuilding work in the affected areas is also unlikely.

We believe the earthquake has increased the likelihood of additional monetary easing measures by the BOJ, and we expect these measures to be implemented in conjunction with the announcement of new government stimulus measures.

… Earthquakes usually have a negative economic impact in the short term and a positive impact over the medium and long terms. Earthquakes destroy human and material resources involved in production activity. The material resources include the private sector’s stock of assets like housing, industrial facilities and offices, and also public infrastructure such as roads, railways, water supply facilities, electricity facilities, ports and airports. The damage to these material resources depresses production activities via the supply side. On the demand side, negative economic effects are also likely due mainly to people holding back from a range of consumption activities. This results in a short-term negative impact on economic activity, such as measured by GDP.

On the other hand, the stock destroyed in an earthquake is then replaced over the medium term. This involves expansion of public investment, capital investment and housing investment, thereby boosting GDP. This is usually termed rebuilding demand. Negative effects on growth generally have the upper hand in the short term (for example, frommeasures to be implemented in conjunction with the announcement of new government stimulus measures.

… The nominal GDP (total domestic production) of the three prefectures most affected by the 11 March earthquake (Iwate, Miyagi and Fukushima) made up 4.0% of the national total in FY07, broadly equal to the prefecture most affected by the Kobe earthquake in January 1995, Hyogo, at 4.0% in FY94 (Exhibits 3–4). However, the Sendai earthquake resulted in greater damage from a large tsunami over a wide area, probably resulting in more substantial destruction of infrastructure and distribution facilities including ports, roads and power plants. As a result, we expect both the short-term negative economic impact and the positive impact of rebuilding demand over the medium term to be greater from the Sendai earthquake than the Kobe earthquake.

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Eleven of Japan’s 54 nuclear power plants have been shutdown, resulting in the loss of roughly 1/4 of Tokyo Electric Power’s generation capacity. From Japan Times:

Prime Minister Naoto Kan announced Sunday that he has approved temporary power outages to prevent a massive blackout in the wake of Friday’s deadly earthquake that struck northern Japan. Tokyo Electric Power Co. said the rolling blackouts, the first ever in Japan, will happen between 6:20 a.m. and 10 p.m. Monday. The prefectures affected are Tokyo, Gunma, Tochigi, Ibaraki, Saitama, Chiba, Kanagawa, Yamanashi and the eastern half of Shizuoka.

“This was a hard decision to make, (knowing) that it would cause a lot of inconvenience to the public,” Kan said, adding that the blackouts could disrupt various necessities such as gas and water supply and medical treatment. “Please be creative in protecting yourselves from this blackout.”

Economy, Trade and Industry Minister Banri Kaieda also told the news conference that power demand is currently 41 million kw per day, but Tepco only has the ability to supply 31 million kw.

Tepco President Masataka Shimizu also told a separate news conference Sunday night that the rolling blackouts are likely to continue through the end of April.